'Google 30% Commission' Becomes a Hot Issue at National Audit... Google Korea CEO Ultimately Absent

[Asia Economy Reporter Seulgina Jo] Despite ongoing controversies, Google, the 'app market giant' that has pushed forward with the '30% commission' policy, is expected to face intense scrutiny at the National Assembly audit on the 7th. However, concerns are rising that the hearing will once again result in a lackluster 'ignorance' dispute, as Nancy Mable Walker, the CEO of Google Korea, who was summoned as a witness, will not attend.

CEO Walker Ultimately Absent... John Lee Expected to Attend with 'Ignorance' Stance

According to industry sources on the 5th, Google Korea recently submitted a letter explaining CEO Walker's absence to the National Assembly's Science, ICT, Broadcasting and Communications Committee. Google Korea cited the spread of COVID-19 and quarantine guidelines as reasons, stating that Walker, currently staying in the United States, is realistically unable to attend the audit.

Instead, John Lee, who oversees advertising sales and marketing in Korea, is expected to attend. He was involved in a controversy over irresponsible remarks and an 'ignorance' stance when he appeared at the audit during the 20th National Assembly. A committee official said, "If CEO Walker does not attend, John Lee will be called," indicating that the committee plans to thoroughly examine the related issues during this audit.

Besides Google Korea, Lee Jaehwan, CEO of One Store, and Jung Jinsu, Vice President of NCSoft, have also been summoned as reference witnesses. Google Korea is expected to testify at the Ministry of Science and ICT audit on the 7th, while the other witnesses will appear at the Korea Communications Commission audit on the 8th to discuss the domestic app market situation and the impact of Google's commission policy changes.

The committee views the change in Google Play's commission policy, which holds a 70% share of the domestic app market, as having serious repercussions on the domestic ecosystem. Jo Seungrae, the ruling party's floor leader on the committee and a member of the Democratic Party of Korea, stated, "It is problematic when a specific business operator, regardless of domestic or international status, uses market dominance to disrupt the entire ecosystem," adding, "We are focusing on unfair practices that exploit superior status, such as forced specific payment methods, unjustified delays in app reviews, and obstruction of registration on other app markets." Related bills have also been continuously proposed since July.

Google's Enforcement of '30% Commission' Deals a Direct Blow to Domestic Ecosystem

The commission policy announced by Google essentially forces app developers on Google Play to use Google's payment method (in-app payment) when selling items and content. In this process, a hefty 30% commission goes to Google. Until now, Google Play applied the 30% commission only to games, unlike Apple's App Store, but from next year, this will be expanded to all content and apps.

This is expected to be a direct blow not only to domestic app developers but also to consumers. Immediate price increases for major content such as webtoons and music are inevitable. There are also growing concerns that the increased cost burden on small and medium developers will ultimately threaten their survival. The industry is protesting that the 'app market giants,' which are practically monopolies, are violating the law by forcing such payment methods.

In response to the ongoing controversy, Google held an online briefing immediately after confirming the commission policy change and offered a carrot by pledging to invest $100 million over the next year to develop the Korean digital content ecosystem, but the reaction remains cold.

Another committee official pointed out, "There is evidence from multiple sources that Google implicitly sanctions app developers who are simultaneously listed on other app markets by limiting their exposure on the first page," adding, "It is necessary to prevent the forced use of specific payment methods or unreasonable discriminatory conditions."

However, concerns are also being raised that this audit will end up as a lackluster dispute. This is because John Lee, who will represent Google Korea at the audit, is in a position where it is difficult to provide responsible answers on the related issues. He appeared at the audit during the 20th National Assembly regarding controversies such as global CPs avoiding network usage fees but was criticized for consistently responding with "I don't know as it is under headquarters' jurisdiction," showing an 'ignorance' stance.

This content was produced with the assistance of AI translation services.